Business Wire | Jul 28, 2021 04:16PM EDT

Universal Insurance Holdings Reports Second Quarter 2021 Results

Jul. 28, 2021

FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--Jul. 28, 2021--Universal Insurance Holdings (NYSE: UVE) (the "Company") reported 2021 second quarter diluted EPS of $0.70 on a GAAP basis and $0.65 on a non-GAAP1 adjusted basis. Quarterly direct premiums written were up 17.0% from the year-ago quarter to $473.6 million, with an annualized return on average equity of 18.7%.

Excludes net realized and unrealized gains and losses on investments as^ well as extraordinary reinstatement premiums and associated commissions1 ("non-GAAP adjusted EPS"). Reconciliations of GAAP to non-GAAP financial measures are provided in the attached tables.

"We delivered solid second quarter results, highlighted by an 18.7% annualized return on average equity, despite continued social inflation within the state of Florida impacting loss costs," said Stephen J. Donaghy, Chief Executive Officer. "We continue to address these trends, in part, with primary rate increase filings, which was a driver of our direct written premium growth during the quarter. We expect primary rate increases to be a tailwind over the medium to long term as they earn-in, but are relentlessly focused on performing through the near term pressure on carriers in the Florida property insurance marketplace, and lament about the unfortunate derivative consequence of price increases on consumers."

Summary Financial Results

($thousands,except per Three Months Ended June 30, Six Months Ended June 30,share data)

2021 2020 Change 2021 2020 Change

(GAAP comparison)

Total $ 279,181 $ 252,704 10.5 % $ 541,938 $ 487,979 11.1 %revenue

Income(loss) 30,059 27,438 9.6 % 66,410 55,022 20.7 %before income taxes

Income(loss) )before 10.8 % 10.9 % (10.0 bps 12.3 % 11.3 % 1.0 ptincome taxesmargin

Diluted EPS $ 0.70 $ 0.62 12.9 % $ 1.54 $ 1.23 25.2 %



Annualizedreturn on 18.7 % 15.6 % 3.1 pts 20.7 % 15.5 % 5.2 ptsaverage equity (ROE)

Book valueper share, $ 15.37 $ 16.56 (7.2 )% $ 15.37 $ 16.56 (7.2 )%end of period



(Non-GAAPcomparison)^ 2

Adjustedoperating 28,372 23,416 21.2 % 64,695 58,777 10.1 %income

Adjusted EPS $ 0.65 $ 0.52 25.0 % $ 1.50 $ 1.32 13.6 %



^2 Reconciliation of GAAP to non-GAAP financial measures are provided in theattached tables. Adjusted operating income excludes net realized and unrealizedgains and losses on investments, interest expense, and extraordinaryreinstatement premiums and associated commissions. Non-GAAP adjusted EPSexcludes net realized and unrealized gains and losses on investments, as wellas extraordinary reinstatement premiums and associated commissions.

Total revenue grew double digits for the quarter driven primarily by rate increases from 2020 earning through the book as policies renew, an increase in policies-in-force when compared to the prior years quarter, and commissions earned on ceded premiums. Total revenue growth was partially offset by the impact of higher reinsurance costs when compared to 2020 and the investment portfolio's performance. GAAP diluted EPS and non-GAAP adjusted EPS results for the quarter were driven primarily by an improvement in weather events when compared to the prior years quarter, and the benefit of a reduced share count, partially offset by the impact of loss cost trends on prior and current accident years. The Company produced an annualized return on average equity of 18.7%.

Underwriting

($thousands,except Three Months Ended June 30, Six Months Ended June 30,policies in force)

2021 2020 Change 2021 2020 Change

Policies inforce (as of 977,251 937,277 4.3 % 977,251 937,277 4.3 %end of period)

Premiums inforce (as of $ 1,618,576 $ 1,389,703 16.5 % $ 1,618,576 $ 1,389,703 16.5 %end of period)



Directpremiums $ 473,627 $ 404,685 17.0 % $ 838,941 $ 739,238 13.5 %written

Directpremiums 392,574 337,639 16.3 % 768,180 663,590 15.8 %earned

Net premiums 256,172 226,370 13.2 % 499,477 447,199 11.7 %earned



Expense 32.0 % 32.6 % (60.0 ) 32.9 % 32.8 % 10.0 bpsratio^3 bps

Loss & LAE 65.3 % 66.9 % (1.6 ) 62.3 % 64.0 % (1.7 )ratio pts pts

Combined 97.3 % 99.5 % (2.2 ) 95.2 % 96.8 % (1.6 )ratio pts pts



^3 Expense ratio excludes interest expense.

Direct premiums written were up 17.0% for the quarter, led by direct premium growth of 19.6% in Florida.

On the expense side, the combined ratio improved 2.2 points for the quarter. The improvement was driven primarily by decreased weather events, partially offset by prior year's reserve development, current year strengthening and higher reinsurance costs impact on the ratio.

* The expense ratio decreased 1.0 pointon a direct premiums earned basis due to continued focus on operating efficiencies, which was partially offset by the impact of increased reinsurance costs on the net ratio, resulting in a 60 basis point improvement in the net expense ratio for the quarter. * The net loss and LAE ratio improved 1.6 points for the quarter. Quarterly drivers include: A 7.5 point net improvement related to no weather events being above plan. Adverse prior year's reserve development of $7.7 million ($0.5 million in 2Q20) resulted in a 2.8 point net increase for the quarter. Net adverse development in the current quarter was driven primarily by continued adjusting and settlement of non-CAT claims on prior accident years. Core losses of $159.5 million for the quarter ($133.9 million in 2Q20) resulted in a 90 basis point increase on a direct premium earned basis, driven by current year strengthening, which was further magnified by the impact of increased reinsurance costs on the net ratio, which led to a 3.1 point increase for the quarter on a net basis.

Services

($thousands) Three Months Ended June 30, Six Months Ended June 30,

2021 2020 Change 2021 2020 Change

Commission $ 9,860 $ 7,758 27.1 % $ 18,986 $ 14,773 28.5 %revenue

Policy fees 6,575 6,546 0.4 % 11,962 12,086 (1.0 ) %

Other revenue 1,991 1,812 9.9 % 3,896 4,594 (15.2 ) %

Total $ 18,426 $ 16,116 14.3 % $ 34,844 $ 31,453 10.8 %

Total services revenue increased 14.3% for the quarter. The increase was primarily driven by commission revenue earned on ceded premiums.

Investments

($thousands) Three Months Ended June 30, Six Months Ended June 30,

2021 2020 Change 2021 2020 Change

Net investment $ 2,858 $ 6,179 (53.7 ) $ 5,844 $ 13,013 (55.1 )income % %

Realized gains 496 168 195.2 % 1,038 467 122.3 %(losses)

Unrealized gains 1,229 3,871 (68.3 ) 735 (4,153 ) NM (losses) %

NM = Not Meaningful

Net investment income decreased 53.7% for the quarter. The decrease is largely attributable to significantly lower yields on the reinvested portfolio following the sale of a majority of securities in the portfolio that were in an unrealized gain position in the third and fourth quarters of 2020.

Capital Deployment

On July 19, 2021, the Board of Directors declared a quarterly cash dividend of 16 cents per share of common stock, payable on August 9, 2021, to shareholders of record as of the close of business on August 2, 2021.

Guidance

The Company is maintaining its guidance for 2021 (assuming no further extraordinary weather events and no realized or unrealized gains in 2021):

* GAAP and Non-GAAP Adjusted EPS in a range of $2.75 - $3.00 * Annualized return on average equity in a range of 17.0% - 19.0%

Conference Call and Webcast

* Thursday, July 29, 2021 at 9:00 a.m. ET * U.S. Dial-in Number: (855) 752-6647 * International: (503) 343-6667 * Participant code: 5571912 * Listen to live webcast: UniversalInsuranceHoldings.com * Replay of the call will be available on the UVE website and by phone at (855) 859-2056 or internationally at (404) 537-3406 using the participant code: 5571912 through August 13, 2021

About Universal Insurance Holdings, Inc.

Universal Insurance Holdings (UVE) is a holding company offering property and casualty insurance and value-added insurance services. We develop, market, and write insurance products for consumers predominantly in the personal residential homeowners lines of business and perform substantially all other insurance-related services for our primary insurance entities, including risk management, claims management and distribution. We sell insurance products through both our appointed independent agents and through our direct online distribution channels in the United States across 19 states (primarily Florida). Learn more at UniversalInsuranceHoldings.com.

Non-GAAP Financial Measures and Key Performance Indicators

This press release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the U.S. Securities and Exchange Commission ("SEC"), including adjusted earnings per diluted share, which excludes the impact of the net realized and unrealized gains and losses on investments as well as extraordinary reinstatement premiums and associated commissions. Extraordinary reinstatement premiums are not covered by reinstatement premium protection and attach just below the Florida Hurricane Catastrophe Fund ("FHCF") reinsurance layer. Adjusted operating income excludes the impact of the net realized and unrealized gains and losses on investments, as well as interest expense and extraordinary reinstatement premiums and associated commissions. A "non-GAAP financial measure" is generally defined as a numerical measure of a company's historical or future performance that excludes or includes amounts, or is subject to adjustments, so as to be different from the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles ("GAAP"). UVE management believes that these non-GAAP financial measures, when considered together with the GAAP financial measures, provide information that is useful to investors in understanding period-over-period operating results separate and apart from items that may, or could, have a disproportionately positive or negative impact on results in any particular period. UVE management also believes that these non-GAAP financial measures enhance the ability of investors to analyze UVE's business trends and to understand UVE's performance. UVE's management utilizes these non-GAAP financial measures as guides in long-term planning. Non-GAAP financial measures should be considered in addition to, and not as a substitute for or superior to, financial measures presented in accordance with GAAP. For more information regarding our key performance indicators, please refer to the section titled "Management's Discussion and Analysis of Financial Condition and Results of Operations - Key Performance Indicators" in our forthcoming Quarterly Report on Form 10-Q for the quarter ended June 30, 2021.

Forward-Looking Statements

This press release may contain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. The words "believe," "expect," "anticipate," "will," "plan," and similar expressions identify forward-looking statements, which speak only as of the date the statement was made. Such statements may include commentary on plans, products and lines of business, marketing arrangements, reinsurance programs and other business developments and assumptions relating to the foregoing. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, including those risks and uncertainties described under the heading "Risk Factors" and "Liquidity and Capital Resources" in our 2020 Annual Report on Form 10-K, and supplemented in our subsequent Quarterly Reports on Form 10-Q. Future results could differ materially from those described, and the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise. For further information regarding risk factors that could affect the Company's operations and future results, refer to the Company's reports filed with the Securities and Exchange Commission, including the Company's Annual Report on Form 10-K and the most recent quarterly reports on Form 10-Q.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS (UNAUDITED)

(in thousands, except per share data)

June 30, December 31,

2021 2020

ASSETS:

Invested Assets

Fixed maturities, at fair value $ 921,800 $ 819,861

Equity securities, at fair value 95,690 84,887

Assets held for sale 7,053 -

Investment real estate, net 5,981 15,176

Total invested assets 1,030,524 919,924

Cash and cash equivalents 286,493 167,156

Restricted cash and cash equivalents 6,134 12,715

Prepaid reinsurance premiums 532,308 215,723

Reinsurance recoverable 196,294 160,417

Premiums receivable, net 74,072 66,883

Property and equipment, net 53,023 53,572

Deferred policy acquisition costs 115,971 110,614

Goodwill 2,319 2,319

Other assets 44,397 49,418

TOTAL ASSETS $ 2,341,535 $ 1,758,741



LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES:

Unpaid losses and loss adjustment expenses $ 278,658 $ 322,465

Unearned premiums 853,896 783,135

Advance premium 68,287 49,562

Reinsurance payable, net 581,818 10,312

Long-term debt 7,721 8,456

Other liabilities 70,313 135,549

Total liabilities 1,860,693 1,309,479

STOCKHOLDERS' EQUITY:

Cumulative convertible preferred stock ($0.01 par - - value) ^4

Common stock ($0.01 par value) ^5 470 468

Treasury shares, at cost - 15,695 and 15,680 (225,751 ) (225,506 )

Additional paid-in capital 105,904 103,445

Accumulated other comprehensive income (loss), (5,571 ) 3,343 net of taxes

Retained earnings 605,790 567,512

Total stockholders' equity 480,842 449,262

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,341,535 $ 1,758,741



Notes:

^4 Cumulative convertible preferred stock ($0.01 par value): Authorized - 1,000shares; Issued - 10 and 10 shares; Outstanding - 10 and 10 shares; Minimumliquidation preference - $9.99 and $9.99 per share.

^5 Common stock ($0.01 par value): Authorized - 55,000 shares; Issued - 46,964and 46,817 shares; Outstanding 31,269 and 31,137 shares.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

REVENUES

Net premiums earned

$

256,172

$

226,370

$

499,477

$

447,199

Net investment income

2,858

6,179

5,844

13,013

Net realized gains/(losses) on investments

496

168

1,038

467

Net change in unrealized gains/(losses) of equity securities

1,229

3,871

735

(4,153

)

Commission revenue

9,860

7,758

18,986

14,773

Policy fees

6,575

6,546

11,962

12,086

Other revenue

1,991

1,812

3,896

4,594

Total revenues

279,181

252,704

541,938

487,979

EXPENSES

Losses and loss adjustment expenses

167,221

151,345

311,184

286,393

Policy acquisition costs

56,766

48,524

113,224

95,388

Other operating expenses

25,097

25,380

51,062

51,107

Interest expense

38

17

58

69

Total expenses

249,122

225,266

475,528

432,957

Income before income tax expense

30,059

27,438

66,410

55,022

Income tax expense (benefit)

8,118

7,556

18,061

15,073

NET INCOME

$

21,941

$

19,882

$

48,349

$

39,949

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands)

Three Months Ended Six Months Ended

June 30, June 30,

2021 2020 2021 2020

REVENUES

Net premiums earned $ 256,172 $ 226,370 $ 499,477 $ 447,199

Net investment income 2,858 6,179 5,844 13,013

Net realized gains/(losses) 496 168 1,038 467 on investments

Net change in unrealizedgains/(losses) of equity 1,229 3,871 735 (4,153 )securities

Commission revenue 9,860 7,758 18,986 14,773

Policy fees 6,575 6,546 11,962 12,086

Other revenue 1,991 1,812 3,896 4,594

Total revenues 279,181 252,704 541,938 487,979



EXPENSES

Losses and loss adjustment 167,221 151,345 311,184 286,393 expenses

Policy acquisition costs 56,766 48,524 113,224 95,388

Other operating expenses 25,097 25,380 51,062 51,107

Interest expense 38 17 58 69

Total expenses 249,122 225,266 475,528 432,957



Income before income tax 30,059 27,438 66,410 55,022 expense

Income tax expense 8,118 7,556 18,061 15,073 (benefit)

NET INCOME $ 21,941 $ 19,882 $ 48,349 $ 39,949

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SHARE AND PER SHARE INFORMATION

(in thousands, except per share data)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Weighted average common shares outstanding - basic

31,240

32,102

31,224

32,347

Weighted average common shares outstanding - diluted

31,310

32,170

31,292

32,440

Shares outstanding, end of period

31,269

31,853

31,269

31,853

Basic earnings (loss) per common share

$

0.70

$

0.62

$

1.55

$

1.23

Diluted earnings (loss) per common share

$

0.70

$

0.62

$

1.54

$

1.23

Cash dividend declared per common share

$

0.16

$

0.16

$

0.32

$

0.32

Book value per share, end of period

$

15.37

$

16.56

$

15.37

$

16.56

Annualized return on average equity (ROE)

18.7

%

15.6

%

20.7

%

15.5

%

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SHARE AND PER SHARE INFORMATION

(in thousands, except per share data)

Three Months Ended Six Months Ended

June 30, June 30,

2021 2020 2021 2020

Weighted average commonshares outstanding - 31,240 32,102 31,224 32,347 basic

Weighted average commonshares outstanding - 31,310 32,170 31,292 32,440 diluted

Shares outstanding, end 31,269 31,853 31,269 31,853 of period

Basic earnings (loss) per $ 0.70 $ 0.62 $ 1.55 $ 1.23 common share

Diluted earnings (loss) $ 0.70 $ 0.62 $ 1.54 $ 1.23 per common share

Cash dividend declared $ 0.16 $ 0.16 $ 0.32 $ 0.32 per common share

Book value per share, end $ 15.37 $ 16.56 $ 15.37 $ 16.56 of period

Annualized return on 18.7 % 15.6 % 20.7 % 15.5 %average equity (ROE)

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SUPPLEMENTARY INFORMATION

(in thousands, except for Policies In Force data)

Three Months Ended

Six Months Ended

June 30,

June 30,

2021

2020

2021

2020

Premiums

Direct premiums written - Florida

$

400,370

$

334,769

$

707,381

$

613,280

Direct premiums written - Other States

73,257

69,916

131,560

125,958

Direct premiums written - Total

$

473,627

$

404,685

$

838,941

$

739,238

Direct premiums earned

$

392,574

$

337,639

$

768,180

$

663,590

Net premiums earned

$

256,172

$

226,370

$

499,477

$

447,199

Underwriting Ratios - Net

Loss and loss adjustment expense ratio

65.3

%

66.9

%

62.3

%

64.0

%

Policy acquisition cost ratio

22.2

%

21.5

%

22.7

%

21.4

%

Other operating expense ratio6

9.8

%

11.2

%

10.2

%

11.4

%

General and administrative expense ratio6

32.0

%

32.6

%

32.9

%

32.8

%

Combined ratio

97.3

%

99.5

%

95.2

%

96.8

%

Other Items

(Favorable)/Unfavorable prior year's reserve development

$

7,731

$

478

$

6,494

$

4,819

Points on the loss and loss adjustment expense ratio

300

bps

21

bps

130

bps

108

bps

6 Expense ratio excludes interest expense.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

SUPPLEMENTARY INFORMATION

(in thousands, except for Policies In Force data)

Three Months Ended Six Months Ended

June 30, June 30,

2021 2020 2021 2020

Premiums

Directpremiums $ 400,370 $ 334,769 $ 707,381 $ 613,280 written -Florida

Directpremiums 73,257 69,916 131,560 125,958 written -Other States

Directpremiums $ 473,627 $ 404,685 $ 838,941 $ 739,238 written -Total

Directpremiums $ 392,574 $ 337,639 $ 768,180 $ 663,590 earned

Net premiums $ 256,172 $ 226,370 $ 499,477 $ 447,199 earned



Underwriting Ratios - Net

Loss and lossadjustment 65.3 % 66.9 % 62.3 % 64.0 %expense ratio

Policyacquisition 22.2 % 21.5 % 22.7 % 21.4 %cost ratio

Otheroperating 9.8 % 11.2 % 10.2 % 11.4 %expense ratio^6

General andadministrative 32.0 % 32.6 % 32.9 % 32.8 %expense ratio^6

Combined ratio 97.3 % 99.5 % 95.2 % 96.8 %



Other Items

(Favorable)/Unfavorableprior year's $ 7,731 $ 478 $ 6,494 $ 4,819 reservedevelopment

Points on theloss and loss 300 bps 21 bps 130 bps 108 bpsadjustmentexpense ratio



^6 Expense ratio excludes interest expense.

As of

June 30,

2021

2020

Policies in force

Florida

723,390

696,829

Other States

253,861

240,448

Total

977,251

937,277

Premiums in force

Florida

$

1,345,532

$

1,144,326

Other States

273,044

245,377

Total

$

1,618,576

$

1,389,703

Total Insured Value

Florida

$

200,600,028

$

177,854,339

Other States

112,637,726

99,662,951

Total

$

313,237,754

$

277,517,290

As of

June 30,

2021 2020

Policies in force

Florida 723,390 696,829

Other States 253,861 240,448

Total 977,251 937,277



Premiums in force

Florida $ 1,345,532 $ 1,144,326

Other States 273,044 245,377

Total $ 1,618,576 $ 1,389,703



Total Insured Value

Florida $ 200,600,028 $ 177,854,339

Other States 112,637,726 99,662,951

Total $ 313,237,754 $ 277,517,290

Three Months Ended June 30, 2021

Direct

Loss Ratio

Ceded

Loss Ratio

Net

Loss Ratio

Premiums earned

$

392,574

$

136,402

$

256,172

Loss and loss adjustment expenses:

Core losses

$

159,412

40.6

%

$

(78)

(0.1)

%

$

159,490

62.3

%

Weather events7

-

-

%

-

-

%

-

-

%

Prior year's reserve development

116,890

29.8

%

109,159

80.0

%

7,731

3.0

%

Total losses and loss adjustment expenses

$

276,302

70.4

%

$

109,081

80.0

%

$

167,221

65.3

%

7 Includes only current year weather events beyond those expected.

Six Months Ended June 30, 2021

Direct

Loss Ratio

Ceded

Loss Ratio

Net

Loss Ratio

Premiums earned

$

768,180

$

268,703

$

499,477

Loss and loss adjustment expenses:

Core losses

$

304,640

39.7

%

$

(50)

-

%

$

304,690

61.0

%

Weather events7

-

-

%

-

-

%

-

-

%

Prior year's reserve development

208,960

27.2

%

202,466

75.3

%

6,494

1.3

%

Total losses and loss adjustment expenses

$

513,600

66.9

%

$

202,416

75.3

%

$

311,184

62.3

%

7 Includes only current year weather events beyond those expected.

Three Months Ended June 30, 2021

Direct Loss Ceded Loss Net Loss Ratio Ratio Ratio

Premiums $ 392,574 $ 136,402 $ 256,172 earned



Loss and lossadjustment expenses:

Core losses $ 159,412 40.6 % $ (78) (0.1) % $ 159,490 62.3 %

Weather - - % - - % - - %events^7

Prior year'sreserve 116,890 29.8 % 109,159 80.0 % 7,731 3.0 %development

Total lossesand loss $ 276,302 70.4 % $ 109,081 80.0 % $ 167,221 65.3 %adjustment expenses



^7 Includes only current year weather events beyond those expected.

Six Months Ended June 30, 2021

Direct Loss Ceded Loss Net Loss Ratio Ratio Ratio

Premiums $ 768,180 $ 268,703 $ 499,477 earned



Loss and lossadjustment expenses:

Core losses $ 304,640 39.7 % $ (50) - % $ 304,690 61.0 %

Weather - - % - - % - - %events^7

Prior year'sreserve 208,960 27.2 % 202,466 75.3 % 6,494 1.3 %development

Total lossesand loss $ 513,600 66.9 % $ 202,416 75.3 % $ 311,184 62.3 %adjustment expenses



^7 Includes only current year weather events beyond those expected.

UNIVERSAL INSURANCE HOLDINGS, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

(in thousands, except for per share data)

Three Months Ended

Six Months Ended

Guidance

June 30,

June 30,

Full Year 2021E

2021

2020

2021

2020

Income (Loss) Before Income Taxes

$

30,059

$

27,438

$

66,410

$

55,022

Adjustments:

Reinstatement premium, net of commissions8

-

-

-

-

Net unrealized (gains)/losses on equity securities

(1,229

)

(3,871

)

(735

)

4,153

Net realized (gains)/losses on investments

(496

)

(168

)

(1,038

)

(467

)

Interest Expense

38

17

58

69

Total Adjustments

(1,687

)

(4,022

)

(1,715

)

3,755

Non-GAAP Adjusted Operating Income

$

28,372

$

23,416

$

64,695

$

58,777

GAAP Diluted EPS

$

0.70

$

0.62

$

1.54

$

1.23

$ 2.75 - 3.00

Adjustments:

Reinstatement premium, net of commissions8

-

-

-

-

-

Net unrealized (gains)/losses on equity securities

(0.04

)

(0.12

)

(0.02

)

0.12

-

Net realized (gains)/losses on investments

(0.02

)

(0.01

)

(0.03

)

(0.01

)

-

Total Pre-Tax Adjustments

(0.06

)

(0.13

)

(0.05

)

0.11

-

Income Tax on Above Adjustments

0.01

0.03

0.01

(0.02

)

-

Total Adjustments

(0.05

)

(0.10

)

(0.04

)

0.09

-

Non-GAAP Adjusted EPS

$

0.65

$

0.52

$

1.50

$

1.32

$ 2.75 - 3.00

8 Includes extraordinary reinstatement premiums not covered by reinstatement premium protection and related commissions.

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CONTACT: Investor Relations Contact: Rob Luther, 954-958-1200 ext. 6750 VP, Corporate Development, Strategy & IR rluther@universalproperty.com

CONTACT: Media Relations Contact: Andy Brimmer / Mahmoud Siddig, 212-355-4449 Joele Frank, Wilkinson Brimmer Katcher